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Stora Enso is investing big in China for Sustainable competitive differentiation in the world’s fastest-growing packaging market
Tuesday, 20 March 2012
Stora Enso plans to build a plantation-based integrated paperboard and
paper mill in the city of Beihai in Guangxi in southern China. The
company will service the rapidly growing market for liquid packaging
and other high-quality consumer board types.
According to a press release from the company, the facility includes a
modern paper machine with capacity of 450,000 tons per year and a pulp
capacity of 900,000 tons per year and the necessary energy plants and
other facilities.
In a unique set-up, the board and pulp mills will be self-sufficiently
integrated with wood supply from 120 000 hectares of self-managed
eucalyptus plantations. The ultimate target is to expand the paperboard
capacity to 900 000 tonnes at a later stage. The operations will be
managed by an equity joint-venture company established by Stora Enso
(85%) and the Guangxi Forestry Group (15%), a state-owned company under
the Guangxi provincial government. The joint venture will serve the
fast-growing market for liquid packaging board and other premium
consumer board grades.
The project investment will be approximately EUR 1.6 billion.
Construction at the industrial site will commence when specific
preconditions have been fulfilled, which is expected to be in the
second half of 2012. Production is scheduled to start in the fourth
quarter of 2014. The investment will significantly support Stora Enso
moving towards company’s 13% ROCE target.
The project will be financed through a combination of debt and equity
on an approximately 60/40 basis. The debt financing is expected to be a
mix of export credit agency, multilateral and commercial bank debt.
“Today we are taking another significant step in transforming Stora
Enso into a global renewable materials company. We already have a
globally leading position in renewable fibre-based packaging boards. We
will now invest in a world-class integrated mill based on locally grown
renewable materials for the benefit of local Chinese consumers in the
fastest-growing market. Everything we do will be based on best-in-class
technologies, environmental standards and sustainability practices –
together with the local partners and communities” says Stora Enso CEO
Jouko Karvinen.
By Scancomark.se Team
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